Monday, March 12, 2012

General Economics

News                                                                                                                             
WSJ | China Posts Massive Trade Deficit
China swung to a massive trade deficit in February, due partly to seasonal distortions but also to faltering demand for the country's exports.
CNN Money | Gas prices top $3.80 a gallon
The national average price for a gallon of gasoline rose above the $3.80 mark Monday, resuming the advance that has plagued drivers throughout the winter.
USA Today | Trade deficit hits 3-year record imbalance
The U.S. trade deficit surged to the widest imbalance in more than three years in January as imports hit an all-time high, reflecting big demand for foreign-made cars, computers and food products.
WSJ | Portugal's Economic Ills Deepen
Portugal's economy continued to contract in the final three months of 2011, the country's statistics agency said Friday, as austerity measures hit domestic demand and the euro-zone crisis slowed exports.
USA Today | Poll: Most rich Americans say U.S. still in recession
Wealthier Americans aren't very optimistic about the economic recovery, with a surprising 63% saying the United States is still in a recession, according to a new poll.

Econ Comments & Analysis                                                                                            
WSJ | A Look at the Global One Percent
While the Occupy Wall Street movement may be waning, the perception of growing income inequality in America is not
Bloomberg | Financial Repression Has Come Back to Stay
As they have before in the aftermath of financial crises or wars, governments and central banks are increasingly resorting to a form of “taxation” that helps liquidate the huge overhang of public and private debt and eases the burden of servicing that debt.
Washington Post | Japan’s lost decades — and ours?
Since the financial crisis, a shadow has hovered over the U.S. economy: Japan. Could what happened there happen to us?
Washington Times | Global slowdown
The global scope of the economic downturn is now official. On Monday, China cut its economic-growth expectation to 7.5 percent, down from the lofty 8 percent level where it has been since 2005
Real Clear Markets | The Misleading Tale of Income Inequality
President Obama has proposed $1.7 trillion in tax increases over the next decade.
Business Week | Student Loan Delinquencies Are Worse Than You Think
Students may be struggling with debt more than we knew, according to a team of five researchers at the Federal Reserve Bank of New York
Reason Foundation | Adam Smith vs. Crony Capitalism
I admit it: I like Adam Smith. His perceptiveness never fails to impress. True, he didn’t foresee the marginal revolution that Carl Menger would launch a century later (with, less significantly in my view, Jevons and Walras), but give the guy a break. The Wealth of Nations is a great piece of work.

Blogs                                                                                                                             
Calculated Risk | Unofficial Problem Bank list declines to 956 Institutions
This is an unofficial list of Problem Banks compiled only from public sources.
Keith Hennessey | In America power and fuel are separate issues
Policies that affect oil, gasoline, ethanol and biodiesel, hybrid vehicles, battery technology, and vehicle fuel efficiency can all directly and significantly affect the price of transportation fuel (although often quite gradually).
National Review | Why Would Anyone be Against the Export-Import Bank?
U.S. exports have been a rare bright spot in an otherwise sluggish economy, increasing by about 20 percent over the last two years and driving about half of all economic growth.
Calculated Risk | Schedule for Week of March 11th
Retail sales for February is the key report this week. For manufacturing, the March NY Fed (Empire state) and Philly Fed surveys will be released on Thursday, and the February Industrial Production and Capacity Utilization report will be released on Friday.
The American | The incredible revival of U.S. manufacturing? Credit trade and energy
The post-Great Recession revival of U.S. manufacturing has given the economy a much-needed boost during the Not-So-Great Recovery. Some great factoids and observation from economist Jim Glassman at JPMorgan
National Review | Income Mobility and Education Reform
Last week, the Wall Street Journal had a disheartening editorial about the attempts in California to undermine the “parent trigger” reform implemented a few years ago as a response to the abysmal record of some of the state’s public schools.

Health Care

News                                                                                                                             
National Journal | White House Asks Advocates About Health Care Law Push
White House officials met this week with health reform advocates from more than 60 organizations to help coordinate plans for news conferences, prayer vigils and other staged events to coincide with Supreme Court oral arguments on challenges to the 2010 health reform law, the New York Times reported on Friday.

Econ Comments & Analysis                                                                                            
WSJ | Coffee Is an Essential Benefit Too
Can you believe the nerve of employers? Many of them still seem to think that they should be allowed to determine the benefits they offer.

Blogs                                                                                                                             
Atlantic | The Myth of the Free-Market American Health Care System
Indeed, there are a lot of misconceptions about how America's health-care system compares to those of the other developed countries, including France
Atlantic | Why Obamacare's Medicaid Expansion Will Reduce Health Care Access
Chapin White of the Center for Studying Health System Change has published an important new paper in Health Services Research, a journal of health economics, which suggests that a critical part of the Affordable Care Act--its expansion of Medicaid coverage to 16 million more Americans--may actually reduce those individuals' access to health care.

Monetary

News                                                                                                                             
CNN Money | Big banks at center of interest rate probe
It affects everything from mortgages to credit cards to student loans, and now some of the world's biggest banks are at the center of a criminal investigation into whether they manipulated it for their own benefit.
Market Watch | No hint of exit from Fed this week
The Federal Reserve will have a quiet meeting Tuesday, intent on making sure that they don’t make any noise about exiting from their easing policy stance, economists say on the eve of the meeting.
Bloomberg | Easiest Credit May Not Abate as Fear Index Plummets
The bid to guarantee growth suggests officials at the four key central banks won’t hurry to pull down the $9 trillion wall of money on their combined balance sheets or boost interest rates stuck near record lows.
CNN Money | Natural gas prices hit 10-year low
Natural gas future prices hit a 10-year low Thursday as slack demand and rising production continued to fuel an oversupply of the product.

Econ Comments & Analysis                                                                                            
WSJ | An Insurance Policy Against Inflation
The Federal Reserve should raise the minimum cash reserve requirements on bank deposits. This will have virtually no immediate impact on credit flows, but it will serve as an insurance policy against the growing risk of inflation.
Real Clear Markets | Americans Don't Benefit From Fed Inflated Asset Prices
The Dow Jones Industrial Average and the S&P 500 have had a rocky couple of weeks, including the largest drop of the year on Tuesday. Their rollercoaster highs and lows haven't really meant much when it comes to economic growth in America though.
WSJ | Uncle Sam's Teaser Rate
One business story these days is how companies are crashing the debt markets to raise money at today's bargain rates. The same goes for the world's biggest borrower, Uncle Sam, which is also quietly benefitting from historically low interest rates that cannot last.
CNN Money | Good jobs report means Fed should sit tight
Repeat after me. There is no need for more QE. There is no need for more QE. There is no need for more QE.

Blogs                                                                                                                             
Tax Foundation | Idaho Considers Tax Supermajority Requirement
State legislation is often described as an expression of majority rule. However, the legislative process contains steps that seem designed to hinder spontaneous expressions of majority sentiment.
Heritage Foundation | Most Voters Say America is Overtaxed
According to a new Rasmussen poll, 56% of likely U.S. voters believe America is overtaxed. Those numbers follow a poll last week that shows that the vast majority of likely voters want individuals and businesses to pay lower rates.
Greg Mankiw | Obama shifts stance on dividend taxes
In the summer of 2008, the Obama campaign's two top economists proudly proclaimed that their candidate favored a dividend tax rate of 20 percent, "lower than all but five of the last 92 years."

Taxes

News                                                                                                                             
Market Watch | Debate on transaction tax heats up in Europe
A debate about imposing a financial-transaction tax in Europe is heating up, with a key discussion set for this week at a summit of the region’s leaders, but observers say there is little chance the European Union will impose such a tax any time soon.

Econ Comments & Analysis                                                                                            
Washington Times | Tax on fuel exports wouldn’t cheapen gas here
The American people understandably are upset about high oil prices that have forced up the price of gasoline, straining family budgets and hurting struggling businesses.

Blogs                                                                                                                             
Tax Foundation | Idaho Considers Tax Supermajority Requirement
State legislation is often described as an expression of majority rule. However, the legislative process contains steps that seem designed to hinder spontaneous expressions of majority sentiment.
Heritage Foundation | Most Voters Say America is Overtaxed
According to a new Rasmussen poll, 56% of likely U.S. voters believe America is overtaxed. Those numbers follow a poll last week that shows that the vast majority of likely voters want individuals and businesses to pay lower rates.
Greg Mankiw | Obama shifts stance on dividend taxes
In the summer of 2008, the Obama campaign's two top economists proudly proclaimed that their candidate favored a dividend tax rate of 20 percent, "lower than all but five of the last 92 years."

Employment

News                                                                                                                             
WSJ | Jobs Recovery Gains Momentum
The U.S. added more than 200,000 jobs for the third straight month, showing gains across industries and demographic groups, in the latest sign that the economy has gained momentum.
USA Today | More younger workers finding jobs
Jobs for 25-to-34-year-olds increased by 116,000 to 30.5 million in February. Their unemployment rate fell from 9% in January to 8.7%, the lowest since January 2009, according to the Labor Department.
USA Today | In quest to stimulate jobs, some states are getting creative
In the quest to create jobs, some states are getting creative: Nevada may hold contests to encourage entrepreneurs. Ohio is giving control of its liquor profits to a group of business leaders. And Washington and Alabama are "selling" income they don't even have yet.

Econ Comments & Analysis                                                                                            
Heritage Foundation | Heritage Employment Report: February Shows Good News
The unemployment rate remained flat even as the labor market increased by 476,000 potential workers. Job creation was robust enough that the labor market absorbed these new workers without an increase in the unemployment rate.
WSJ | The Jobs Rally
Sometimes you simply have to marvel at the resilience of the private economy in America, and yesterday's upbeat jobs report was one of those moments. Employers shook off the dysfunction in Washington and added 227,000 new workers in February.
Real Clear Markets | Obama Stumbles On Jobs Secret: Do Nothing
During the seven months from January 2011 through July 2011, the federal government had its "stimulus" pedal to the metal. Concurrently, the Federal Reserve was conducting its "Quantitative Easing 2" (QE2) monetary stimulus program.
WSJ | What North Dakota Could Teach California
In his speech last week responding to high gas prices, President Barack Obama insisted that "we can't just drill our way out of" our energy woes. Actually, we can
The American | How Obama’s Energy Policy Will Kill Jobs
President Obama is once again proposing selectively punitive treatment of the oil and natural gas industry, one of the strongest job-creating sectors of the U.S. economy.
Fortune | Unemployment: Leveling off or just a retirement influx?
Contrary to what most economists think, aging Baby Boomers entering retirement has largely driven down the unemployment rate.
WSJ | Piecing Together the Job-Picture Puzzle
At 8.3%, the unemployment rate has fallen 0.7 percentage point from a year earlier and is down 1.7 percentage points from a peak of 10% in October 2009. Many other measures of the job market are improving.

Blogs                                                                                                                             
Keith Hennessey | A good Jobs Day
We are still 5.3 million jobs shy of peak employment in December 2007 and 864,000 shy of January 2009 when President Obama took office.
The American | The real unemployment rate? It sure isn’t 8.3%
Even if it were a legit number, the 8.3% February unemployment rate, released today by the Labor Department, would be simply terrible—and unacceptable. It would still extend the longest streak of 8%-plus unemployment since the Great Depression.
Economist | Behind the jobs curve
On Friday, the Bureau of Labour Statistics reported an increase in payroll employment of 227,000 jobs in the month of February. Encouragingly, job gains for December and January were revised upward, by 20,000 and 41,000, respectively.
WSJ | Why Didn’t Unemployment Rate Drop?
The U.S. unemployment rate stayed at 8.3% in February, but a broader measure dropped to 14.9% from 15.1% the prior month, indicating that the labor market is strengthening.
The American | Obama’s part-time job recovery
The economy is adding jobs, though not enough to bring down the sky-high unemployment rate. But it’s not just the quantity of jobs that’s a problem, it’s the quality, too.
WSJ | Where Will 2012 Jobs Growth Come From?
The government reported broad-based gains in jobs for February, but which industries will be adding to payrolls over the coming year?
Political Calculations | Teens Absent from Job Gains
It's happened again! In a month that saw job gains for all other age groups, American teens saw their numbers in the U.S. workforce decline. Again.

Budget

News                                                                                                                             
WSJ | Greece's Credit Non-Event
So after all the weeks of angst and protest, Greece was able to restructure its debt. But it couldn't do so without imposing losses on unwilling creditors, and so late Friday the International Swaps and Derivatives Association declared that Greece had defaulted at last, triggering among other things credit default swaps on Greek debt. The world did not end.
Bloomberg | Greek Bailout Payment Set to Be Approved by Euro Ministers After Debt Deal
Euro-area finance ministers seeking to step past the largest sovereign debt restructuring in history will attempt to gain a foothold this week as they grapple with implementing the latest Greek bailout.
WSJ | Greece Defaults, and Tries to Move On
Greece will reap fast relief from a historic €200 billion ($266 billion) debt restructuring sealed Friday, but the default isn't likely to end the debt-strapped country's epic financial problems.
WSJ | Spain's Move Tests Europe's Mettle on Deficits
Spain's stand-off with Brussels over the size of its 2012 budget deficit has presented officials in the city with a dilemma: How do they preserve the credibility of the tighter fiscal rules without triggering a Greece-style downward economic spiral by forcing Spain to slash its deficit too vigorously?

Econ Comments & Analysis                                                                                            
Washington Times | Backbone in the budget season
Plans for 2013 already have Washington nearing the spending limit set last summer in the Budget Control Act. Congressional Republicans struck that deal with President Obama, letting him raise the debt ceiling by $2.1 trillion in exchange for less spending.

Blogs                                                                                                                             
Library of Economics | Real Austerity
The lawmakers said they would turn Medicare into a premium support plan that would give seniors the same healthcare plan as members of Congress. They say this would save an estimated $1 trillion over 10 years.
WSJ | Most Borrowers Not Paying Down Student Loans
39%: The percentage of student loan borrowers who were paying down their balances in the third quarter of 2011.